India is undergoing an energy transition from fossil-based to clean energy. Our quarterly Market Handbook helps identify and analyse trends, present data-backed evidence and connect the dots to present a short-term market outlook.
Key Findings
  • Total generation in FY23 was up by 11.5% compared to FY22. Contributing factors included a higher number of heat wave days and the absence of active western disturbances in Q1 FY23 and higher colder-than-usual days in December 2022 and January 2023.
    • Q1: Up by 16.0%
    • Q2: Up by 6.8%
    • Q3: Up by 10.0%
    • Q4: Up by 11.8%
    • Total FY21: Up by 11.5%
  • Overall RE generation increased by 21.8%,while large hydro and coal/lignite generation grew by 6.1% and 12.0%, respectively (vs FY22).
  • From an average daily generation perspective, the share of RE and coal/lignite increased, whereas hydro share declined in FY23 compared to FY22.
    • RE: Share up from 10.8% to 11.8%
    • Hydro: Share down from 11.5% to 11.0%
    • RE + Hydro: Almost constant from 22.3% to 22.8%
    • Coal/lignite: Share up from 72.5% to 73.1%
Figure 1: Source-wise daily generation
Source: POSOCO. Note: RE technologies include solar, wind, biomass, waste-to-energy, and small hydro and do not include rooftop solar and large hydro (>25 MW) generation.
  • As of March 2023, legacy dues# of discoms to generating companies reduced from INR 1,38,378 crore to INR 91,061 crore and the current dues# stood at INR 28,449 crore. The legacy dues were down by 34% in March 2023 (vs March 2022).
  • According to the Ministry of Power’s (MoP) Ujwal DISCOM Assurance Yojana (UDAY) platform, discoms in Karnataka, Haryana, Madhya Pradesh, Uttar Pradesh and Assam topped the latest quarterly performance assessment*.
  • As per the performance of the power utilities report 2021-22, pan-India AT&C losses stood at 16.5% vs 21.5% in 2020-21.
*As of December 2022. #Legacy dues are already past their due date and remain partially or completely unpaid. Current dues are partially or completely unpaid but are still within their respective due dates.
Figure 2: Discom payable and receivable days for RE rich states
Source: UDAY portal (based on data disclosed by discoms as of 31 December 2022). *Data not available for these states; values derived from 2019–20/ 2020–21 financial reports.
  • In FY23, most of the listed RE stocks trended downwards, barring a few peaks in Q2 and Q3 FY23. The market (Sensex) mostly remained stagnant throughout the year.
  • The share price of RE developer Adani Green Energy saw a sharp plunge in Q4 FY22, down by 53.9% in March 2023 (vs March 2022).
  • In the case of Sterling and Wilson Solar, the share price was down by 8.32% in March 2023 (vs March 2022).
  • The share price of Borosil Renewables, which holds a near monopoly position in India’s solar panel glass manufacturing, was down by 29.2% in March 2023 (vs March 2022).
  • The share price of wind developer–manufacturers Inox Wind was down by 15.7%, whereas Suzlon Energy’s was down by 13.6% in March 2023 (vs March 2022).
Figure 3: Change in key renewable energy stock prices (indexed to 100)
Source: Money Control.
Note: Share prices are the last traded value in each month
  • Reserve Bank of India (RBI) conducted the first sovereign green bond (SGrB) auction worth INR 16,000 crore in two tranches in FY23. It had two SGrB offerings (a) 5-year (SGrB 2028) and (b) 10-year (SGrB 2033). Both tranches were oversubscribed; the 5-year offering received 96 and 62 bids, and the 10-year offering received 170 and 91 bids in tranche I and II, respectively. The proceeds will be used to finance and/or refinance expenses of eligible green projects as per the sovereign green bonds framework.
  • In FY23, the repo rate was hiked six times from 4.0% (April 2022) to 6.50% (March 2023).
  • Key bond yields in India, including the 10-year treasury and NTPC’s 10-year bond yields, fluctuated throughout the year.
Figure 4: Bond yields* and key financial rates
Source: Reserve Bank of India, State Bank of India, Trading Economics, Money Control, and BondEvalue. *Current yield.
Note: Bond prices are the last traded value in each month.

Key Indicators
Share of RE in FY23
11.8%
up from 10.8% in FY22
Capacity auctioned
9.91 GW
in FY23
Amount overdue to power producers as of March 2023
INR 91,061 crore
Down by 34% from March 2022
Market concentration for RE auctioned capacity
50%
in FY23
Author's Name
Ruchita Shah
Programme Associate
Riddhi Mukherjee
Research Analyst
For queries reach out to author
[email protected]
Tags
Energy Transition
Discoms
RE Developers
RE Auctions
Green Bonds
EV
Power Markets
Clean Energy Investments
Energy Storage